islamic upset. the film depiction of prophet muhammad sparks protests in egypt and libya and here in the u.s. the violence is setting off a firestorm. eye on iran. israel's prime minister said the u.s. is not doing enough to prevent iran from developing a nuclear weapon. >> those in the international community who refuse to put red lines before iran don't have a moral right to place a red light before israel. >> and apple announcement, the tech world gets set as apple gets ready to announce it's next generation iphone. this is "cbs morning news" for wednesday, september 12, 2012. good morning, everybody. i'm terrell brown. this morning the state department is condemning actions

that left two americans dead. one diplomat was killed. during an attack on the american consulate in libya. heavily armed militants opened fire and set the consulate on fire. they stormed the embassy in egypt. it was sparked by a video which ridicules islam and the prophet muhammed. the director is now in hiding. the incident set off a political firestorm in this country. we go to susan mcginnis in washington for more. >> reporter: the protesters were outraged by the trailer to a two hour film that ended up being posted to youtube. washington is concerned that the violence may spread to other countries and it wasn't long before politics entered the fray. fires burned in libya this morning after armed gunmen stormed a building killing one american and wounding another. >> americans want to say

0 something bad about prophet muhammad. >> reporter: in egypt demonstrators scaled the wall of the embassy tearing down the american flag and replacing it with an islamic banner. >> we will never accept our prophet muhammed -- >> reporter: those behind the attacks blame an american film they say ridicules prophet muhammad. >> don't make our people angry because they will kill. they will fight. they will do this situation. >> reporter: in response the u.s. embassy in egypt issued a statement saying it condemns the continuing efforts by misguided individuals to hurt the religious feelings of muslims. in a statement secretary of state hillary clinton said let me be clear, there is never any justification for violent acts of this kind but it was a statement from the embassy in egypt that set off a political firestorm between the obama and romney campaigns.

>> thank you so much. >> reporter: mitt romney respond in a statement saying it's disgraceful that the obama administration's first response was not to condemn attacks on our diplomatic mission but to sympathize with those who waged the attacks. >> hello. >> reporter: obama campaign spokesman respond eed to romney saying we're shocked that governor romney would choose to launch a political attack. published reports claim the embassy's statement of not cleared by the state department and the white house does not agree with it. now the filmmaker said he thinks islam is a cancer and that he fully intended the film to be a political statement condemning the religion. >> susan mcginnis in washington this morning. iran's nuclear program, and its effect on u.s.-israeli relations. president obama and benjamin netanyahu spoke for an hour. they rejected a request for the prime minister to meet with the president next week. this follows strong words from benjamin netanyahu criticizing

u.s. policy designed to push the u.s. into action. david martin reports. >> reporter: with intelligence reports iran has been working on computer simulations of nuclear explosions, israel's prime minister benjamin netanyahu scolded the obama administration for refusing to lay down a red line which would trigger a military strike. >> if iran knows that there's no red line, if iran knows that there's no deadline, what will it do? exactly what it's doing. it's continuing without any interference towards obtaining nuclear weapons capability. >> reporter: benjamin netanyahu seemed to be reacting to remarks by secretary of state hillary clinton who said there's still time to head off iran's nuclear program. >> we're not setting deadlines. we're, you know, we're, you know, watching very carefully about what they do because it's more about their actions than words.

>> reporter: according to one report, iran recently bought computer codes for simulating nuclear explosions from north korea. that doesn't mean iran has decided to build a weapon but it does mean it's developing the capability to build a weapon and benjamin netanyahu seems fed up with american patience. >> the world tells israel wait. there's still time. and i say wait for what? wait until when? those in the international community who refuse to put red lines before iran don't have a moral right to place a red light before israel. >> reporter: but in an interview this morning with cbs's norah o'donnell, leon panetta said the u.s. has a very clear red line. >> when they make a decision to go ahead and build a nuclear weapon that for us is a red

line. >> reporter: panetta said u.s. intelligence would likely know when that decision is made. the u.s. military would have about a year to mount a strike that could stop iran from actually building a weapon. david martin, cbs news, pentagon. bill clinton campaigns on behalf of president obama in florida. it's the second day of his campaign swing. he says president obama has put the economy on the right course. >> you have to decide whether you believe that this 500,000 new manufacturing jobs we got since the bottom of the recession is just some sort of accident that will go away or you like it we're making thing in america again and you want to see more of it. >> mitt romney arrived in florida last night. earlier he spoke to a group of national guardsmen in reno, nevada. cbs money watch.

a downgrade threat from moody's and facebook mark zuckerberg breaks his silence. >> reporter: good morning. the government's debt rating could take another hit. moody's investment service says it will cut its aaa rating on u.s. debt if president obama and congress cannot come up with a budget deal. the president didn't sound optimistic. >> two months before an election the speaker is obviously supportive of my opponent and his party and he wants to win as many seats as he can and he's not going to go out of his way to try to help me get things done that he thinks i may be able to take credit for. >> reporter: if budget negotiations fail more than a trillion dollars of automatic spending cuts and increases will go into place on january 2nd. overseas markets got a boost.

tokyo's nikkei gained 2%, hong kong hang seng added 1%. the federal reserve policymakers meeting begins today and investors are keeping their fingers crossed. ben bernanke will announce new steps to stimulate the economy. on wall street. the dow was up 69 points, the nasdaq stayed flat. the cost of the health care in the united states continues to rise. annual premiums rose 4% for americans who got their insurance through work. the annual premium is close to $16,000. employees paying $4300 of that. facebook ceo mark zuckerberg made his first public comments since the social media company went public back in may. he called the stock's performance disappointing but is remaining hopeful. facebook shares have lost nearly 50% of their value since the ipo.

and let the buzz begin, apple is set to announce the latest version of the iphone today. industry analysts expect the new iphone will have a larger screen, a smaller dock connector and faster processor. also likely to have a different face than the iphone 4. >> the 4s is iphone 4. you couldn't tell the difference. this is a phone you can see from across the room and know it's the newer device. >> reporter: the new iphone isn't just revving up gadget geeks. sales of the next generation smartphone could add up to half of a percentage point to the fourth quarter gdp. quite a product there. >> i know. it will help the whole economy. >> reporter: might bring me over. >> come hang with the cool kids. >> reporter: i'm not that cool. >> take care. see you tomorrow. coming up, a weather gamble. las vegas gets hit by flash flooding, swamping roads and stranding motorists.

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two deadly fires in pakistan last night in the southern city of karachi killed 100 people. dozens more are were injured. officials say most of the dead were trapped in the basement and suffocated. police are looking for the owners of the building. huge fire at a huge factory killed at least 25. the fire may have been caused by a faulty generator. from fire to rain, thunderstorms drenched parts of the southwest tuesday. flash floods delayed flights and knocked out power to thousands. the fast-moving water stranded several motorists. >> reporter: an inch of rain pounded motorists in las vegas in the hour long thunderstorm causing mudslides and blocking roads. the swift water rescue team use

-- used a helicopter to save those trapped by the fast-moving waters. it was a dangerous rescue as the chopper hovered close to high voltage power lines. >> we have super high level high voltage lines and smaller ones for more residential use on the south side of the street. here's this helicopter here hovering just about 50 feet above the power lines. >> reporter: 13,000 customers lost power as water flooded entire neighborhoods. >> oh, wow. oh, my goodness. >> reporter: the las vegas strip wasn't spared either. water rushing in the basement of the flamingo hotel and casino. >> drivers are debating whether they should come north. some are turning around. >> reporter: las vegas firefighters responded to dozens of calls. no serious injuries were reported. the city normally gets four inches of rain a year. edward lawrence for cbs news. >> up next your weather on this wednesday morning and in sports baltimore red sox at-bat as the pennant race heats up. in sports baltimore red sox at-bat as the pennant race heats up.

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and south and a few storms will pop up in the texas/oklahoma panel. >> in sports, brian mccarthy is back home. the oakland starter had surgery after being nailed by a line drive. his skull was fractured and had a contusion on his brain. doctors say he won't be on the mound for the rest of the season. dan straley got called up to replace mccarthy and wrote 32 on the mound. coco crisp lashes one down the left-field line and gets one away from torii hunter. a's over the angels 56-5 for fifth straight win. not good for the orioles. jason hamel injured his knee in the fourth. same knee he had surgery on in july. he'll be examined today. the rays won. baltimore now tied with the yanks for the lead in the american league east. in the national league dodgers lose a close one against the arizona diamondbacks.

struck out six. hits a deep double to right in the seventh and paul goldsmith scored from first for the game's only run. arizona topped l.a. 1-0. dodgers are now six games behind the giants. when we come back hope stays on a laptop. how a 9/11 victim bucket list inspired volunteers to carry out her dreams. top. your nightly congestion without the blowing the stacking the steaming. that's the transformative power of one ingenious little breathe right. try one free at breatheright.com and open your nose instantly. feel the power of air sleep like you mean it and rise to mornings alive with activity. breathe better, sleep better. one free try is all it takes. it's your right to breathe right!

here's a look at the weather in some cities around the country. in d.c. pleasant, 83 degrees. sun in atlanta, 84. st. louis 86. denver cold with showers and 61. mostly sunny in seattle and 70 degrees. americans marked the 11th anniversary of the 9/11 attacks with subdued ceremonies across the country. [ bell ringing] at ground zero bells sounded the moment the first hijack plane

hit the world trade center. relatives read the names of 3,000 victims. president obama observed a moment of silence at the white house. and laid a wreath at the pentagon. 184 people were killed. of the 3,000 who died on 9/11 one victim's memory is being kept alive. ann nelson was trapped on the 104th floor of the world trade center. one of her dreams have become a reality in a house that bears her name. >> normally you would scream or cry or something like that but i couldn't do any of that. i couldn't even talk. >> when the world trade center was attacked, jeanette nelson was halfway across the country in north dakota watching the horror unfold on tv. she knew that her only daughter ann, a 30-year-old bonds trader was working that day on the 104th floor of the north tower. >> i didn't dare leave the television set for fear there would be some sign of her and i would miss it. and on the other hand it was so

painful to watch. >> ann nelson did not survive. when her belongings arrived home they included her laptop. >> when the laptop came home but annie did not, i could not bear to look at it. >> it took her nearly five years to open the computer. >> be a good friend. >> when she finally did. >> grand canyon. >> she found this. >> volunteer for a charity. >> her daughter's hope and dreams. her bucket list. >> buy a home in north dakota. >> or build one. this past weekend more than 500 volunteers traveled to this remote corner of north dakota to help build annie's house. in keeping with her passion for skiing and volunteer work this house will be an 11,000 square foot ski lodge built to accommodate disabled children and injured veterans.

the organization is a charity that says new york says thank you, created after 9/11. the volunteers include new york city firefighters, ground zero construction workers, and 9/11 families. who traveled the country helping communities rebuild after natural disasters. this is the first time the group is building something in honor of a victim of 9/11. >> what would annie think of annie's house? >> she would be delighted. i like to think that she does look at annie's house and it fills her heart today with joy. >> annie's bucket list will be prominently displayed on the rafter to make sure she and her dream are never forgotten. chip reed, cbs news, north dakota. coming up, new york city mayor michael bloomberg is on cbs "this morning."

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a virginia woman stumbled on to some hidden treasures. she bought this renoir painting about two years ago. it was in a box that she paid $7 for. she forgot about it until recently. the painting dates back to 1879. when auctioned later this month will fetch as much as $100,000 if not more. get that money. like winning the lottery. this past summer a grandmother from new york became the unwitting story of a video being shown being bullied. after the incident she received support and donations from people all over the world. on tuesday she was presented with a check that came from 30,000 people in 80 countries. >> reporter: it's a new beginning for karen klein. >> i feel like a different person.

>> reporter: she's now more than $700,000 richer thanks to donors from all over the world who reached out to her. >> i can't believe people donated like that. >> reporter: this is what sparked the kindness of strangers and video posted three months ago of a bus monitor in rochester, new york being bullied by 12 and 13-year-old students. it went viral, triggered outraged and moved max to action. a victim of bullying himself the toronto man began an online fundraiser. >> i had an idea that came from the heart and i truly believed in. i didn't expect anything of it. i just said hey let's give this lady a nice vacation. >> reporter: what began as a $5,000 exploded and karen can now retire. her story has taken her around north america and she may soon go on a cruise. as for that video she hasn't watched much of it but has been praised for staying calm during the ordeal.

>> she did great. i've never been so proud of her that day i was the most proud of my mom. >> reporter: the four students had to do community service and attend different schools. the bullies sent letters of apology. but she has a message for them. >> don't do it to anybody. just don't do it. >> reporter: karen's journey doesn't end here. max has plans for an nonprofit anti-bullying tv show and has began another campaign called 7 million acts of love. >> we thought we would raise funds for free counselling for bullied kids and their families. >> reporter: karen has started a anti-bullying foundation. she says max has changed her life. >> i know there are nice people out there. i always wasn't so sure but i know now. coming up after your local news on cbs "this morning" full

coverage and reaction on the attacks on the embassy in libya and consulate in egypt. iphone 5 being unveiled this morning. we'll hear that a little later on cbs "this morning." that will do it. i appreciate you watching. i'm terrell brown. have a great day. i'm terrell brown. have a great day.

we begin with some breaking news. and ambassador whip. it ties is reportedly among those killed as a protest turned violent at the u.s. consulate in liby